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French luxury giants dive into Silicon Valley

July 30, 2018

Steve Jobs may have been a tech genius, but he clearly didn't care much for fashion.

Facebook boss Mark Zuckerberg has followed in his footsteps, sporting a plain grey T-shirt every day for years -- only to swap it for a simple black suit to testify before Congress and the European Parliament.

Sensing an opportunity, French luxury titan Hermes has launched its 34th US store in Palo Alto, the ultra-rich beating heart of the world's technological behemoths.

"We opened this new store after our San Francisco store reaped very strong results," Hermes CEO Axel Dumas told shareholders in June.

"It's also a bet on the future. Right now, you can see how residents often invest more in their cars than in their clothes. We hope to be able to change that a little," Dumas added.

Guillaume de Seynes, a top executive at Hermes, sees great potential in Silicon Valley.

Palo Alto "isn't very far away from San Francisco, where luxury is everywhere. However, the environment is very different. People are very focused on their professional success, working very long hours", he said.

For now, that potential has yet to blossom, with Silicon Valley's residents still mostly seen in jeans, T-shirts and trainers.

But just because they don't necessarily wear designer clothing, the children of the digital revolution aren't by any means new to luxury.

"This particular population segment... has already adopted luxurious lifestyle habits," said Elisabeth Ponsolle des Portes of the Comite Colbert, which groups together 82 French luxury houses specialising in fashion, gastronomy, hotels and culture.

"They invest a lot in real estate, contemporary art, cars and charity. They also know a lot about wine and gastronomy," she added.

- 'Planting a seed' -

Comite Colbert has entered into a partnership with the prestigious Stanford University, located in Silicon Valley. From September, artisans will teach students the coveted techniques honed over centuries by French goldsmiths.

In December, the group plans to welcome some 70 Californian industrialists and investors in Paris, where they will visit tailoring workshops and dine in Versailles -- "unique experiences that money can't buy", Ponsolle des Portes said.

"We are planting a seed," she said, adding that it wasn't financial return that the firms were after.

Rather, her group wants to "to help (Silicon Valley residents) understand the difference between marketing-based luxury and the real thing".

Beyond the beauty of the scarves and elegance of the bags and shoes, French luxury houses may also have another lesson in store for Silicon Valley giants.

According to Ponsolle des Portes, tech companies are intrigued by "the longevity of our enterprises".

Hermes was founded in Paris in 1837, Cartier in 1947, and Dior in 1946.

Google was born in 1998, and Facebook in 2004.

"In the Silicon Valley business model, companies are 'uberised' within five years," Ponsolle des Portes said.